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Social Studies help for American History, Economics and AP Government. There are class notes, numerous Supreme Court case summaries and information on how to write a research paper inside.

Government Protection of the Consumer

American used to operate under the assumption that it was the consumer's obligation to protect them self against unfair business practices. The motto of the day was "E Caveat Emptor," or Let the Buyer Beware. Today this is no longer the case. Ever since the Progressive Era and the efforts of muckrakers like Upton Sinclair, the government has played an increasing role in protecting the consumer.

As civilized society has developed, the dangers we face are increasingly of our own making poisonous chemicals, polluted air, automobile accidents, defective products. And as the nature of the dangers has changed, so has the way we respond. We have increasingly looked to government to protect us from man-made dangers that we feel incapable of protecting ourselves from. One dangerous place in modern society is the highway.


Over 50,000 people are killed in automobile accidents in the US. each year. In order to reduce the death and injury rate, the Department of Transportation (DOT) has required automobile manufacturers to provide certain safety features such as seat belts, standards for bumpers, and secure fuel tanks. The DOT conducts crash tests on new car models to determine which ones give the passengers the most protection.

 

SELECTED GOVERNMENT REGULATORY AGENCIES

Agencies that regulate specific industries:

Interstate Commerce Commission (ICC) - 1887 - Railroads, trucking, pipelines, barges, express carriers

Federal Reserve Board (FRB) - 1913 - Banks

Federal Trade Commission (FTC)- 1913 - Interstate Trade

Federal Power Commission (FPC) - 1930 - Public utilities

Food and Drug Administration (FDA) - 1931 - Food, drugs, cosmetics

Federal Communications Commission (FCC) - 1934 - Radio, television, telephone, telegraph

Federal Aviation Administration (FAA) - 1967 - Airline safety

National Highway Traffic Safety Administration (NHTSA) - 1970 - Motor vehicles


Agencies that regulate specific functions:


Securities and Exchange Commission (SEC) - 1934 - Sales of securities

National Labor Relations Board (NLRB) - 1935 - Labor-management relations

Equal Employment Opportunity Commission - (EEOC) - 1964 Hiring practices

Environmental Protection Agency (EPA) - 1970 - Pollution of the environment

Occupational Safety and Health Administration (OSHA) - 1971 - Conditions in workplaces

Consumer Product Safety Commission (CPSC) - 1972 - Design and labeling of goods



One of the most important government agencies dealing with product safety is the Food and Drug Administration (FDA). If products are found to be unsafe, the FDA has the power to order them off the market. The agency conducts tests on prepared foods to find out if any of the ingredients are cancer-causing. No new drugs may be put on the market without the FDAs approval.


Another federal agency concerned with consumer safety is the Consumer Product Safety Commission, which issued a recall of asbestos-insulated hair dryers, put an end to the use of benzene in paint removers, banned the use of Tris, cancer-causing flame retardant in children's clothing-and required that slats on baby cribs be set closer together to prevent strangulation.


There are government agencies not only to protect our health, but to protect our pocketbooks. The Federal Trade Commission (FTC) tries to prevent deceptive advertising. These are called Truth in Advertising laws. It has made producers of aspirin pills, diet breads, toothpastes, cigarettes, and numerous other products either prove their claims or change their advertisements. The FTC also has the power to issue what is known as a "cease and desist" order. This powerful tool allows the FTC to halt any unfair business practices.

To protect the interests of investors and provide more stability to the financial markets, the Securities and Exchange Commission was set up in 1934 to regulate the stock market. It requires full disclosure of a company's financial condition when new stock is issued, and has helped eliminate stock swindles.


In recent years there has been legislation requiring financial institutions and companies extending credit to provide the borrower with complete information about the true interest charges and payment conditions. These are called Truth in Lending Laws. In some states, customers are allowed to cancel certain kinds of purchase contracts within a few days after signing them. Some of the types

of contracts which can be canceled are land purchases in undeveloped land promotions and contracts signed with door-to-door salespeople. These laws are designed to protect consumers from being manipulated into hasty, unwise decisions by high-pressure sales techniques.


The Occupational Safety and Health Act (OSHA) gave the Labor Department the power and responsibility to set standards for the workplace to protect workers from work-caused injury and illness. Since 1972, the first full year of OSHA operation, job fatalities have been reduced 10% and disabling injuries have declined from one for every 34 workers to one for every 43 workers during the year.


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